Should You Become a Wal-Mart Shopper?

Wal-Mart is known for offering shoppers very attractive prices. But can the same be said of its stock?

Stifel Nicolaus sure thinks so.

The firm upgraded Wal-Mart to "buy," with an $83 price target saying the retailer is likely to remain resilient during a possible slowdown like it did in 2008.

(As consumers faced high gas prices, food inflation and a shaky housing market in 2008, Wal-Mart gained 20% as cash strapped Americans pinched pennies.)

Other advocates of the stock point out that Wal-Mart is experiencing an increase in once a week shoppers; they say it’s a sign that more Americans are turning to Wal-Mart as a grocery store – drawn to their less expensive food items.

Although canned vegetables, paper towels and peanut butter pretzels may be cheaper at Wal-Mart, top trader Stephanie Link, director of research at TheStreet, argues that the same can not be said of its stock.

“It’s trading around 14 times earnings and historically the average is 13 times.” If anything she says the stock is expensive.

She concedes that the stock has been a strong defensive trade but after the move she thinks there are better places to play.

“For example, Target is a better bet,” she says. “And I’m watching Costco. I’m a buyer of Costco if it pulls back.”

As a consumer you'll get good prices at Wal-mart but as an investor, “There are much better values,” she concludes.

Posted by CNBC's Lee Brodie

______________________________________________________
Got something to to say? Send us an e-mail at [e-mail] and your comment might be posted on the Rapid Recap. If you'd prefer to make a comment, but not have it published on our Web site, send those e-mails to [e-mail].

Trader disclosure: On August 6, 2012, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Joe Terranova is long SEPT. MINI S&P FUTURES; Joe Terranova is long VRTS; Joe Terranova is long MCD; Joe Terranova is long USB; Joe Terranova is long GS; Joe Terranova is long JPM; Joe Terranova is long YHOO; Joe Terranova is long SBUX; Joe Terranova is long WFM; Joe Terranova is long AAPL; Joe Terranova is long EMC; Joe Terranova is long NXPIZ; Stephanie Link is long AAPL; Stephanie Link is long MCD; Stephanie Link is long DIS; Stephanie Link is long SLB; Stephanie Link is long LRCX; Steve Grasso is long ASTM; Steve Grasso is long BA; Steve Grasso is long D; Steve Grasso is long FRO; Steve Grasso is long LNG; Steve Grasso is long MHY; Steve Grasso is long MO; Steve Grasso is long NVIV; Steve Grasso is long PFE; Steve Grasso is long S; Steve Grasso is long XLU; Jon Najarian is long call spreads in GMCR; Jon Najarian is long call spreads in OCN; Jon Najarian is long call spreads in SBUX; Jon Najarian is long call spreads in YELP; Jon Najarian is long call spreads in MON; Jon Najarian is long put spreads in HPQ; Jon Najarian is long put spreads in KCG; Jon Najarian is long CME; Jon Najarian is long CBOE; Jon Najarian is long CIGX; Jon Najarian is long GLUU

For Michael Pachter
Nothing to disclose

For Andrew Root
Macquarie Group managed or co-managed a public offering of securities on behalf of American Water Works Company, Inc. Within the last 24 months, Macquarie Group has received compensation for investment advisory services from American Water Works Company, Inc: AWK
Macquarie Capital (USA), Inc. is a market maker in the equity securities of Life Technologies Corp.: LIFE
Macquarie Group Limited or one of its affiliates received compensation for products and services other than investment advisory services from Occidental Petroleum during the past 12 months. During this time, Macquarie Group Limited or one of its affiliates provided non-securities, non-investment advisory securities related services to Occidental Petroleum.: OXY
The primary analyst for PotashCorp has visited its material operations and development assets within the past year; the company has furnished local transportation and accommodations as part of these site visits. Macquarie Group Limited or one of its affiliates received compensation for products and services other than investment advisory services from Potash Corporation during the past 12 months. During this time, Macquarie Group Limited or one of its affiliates provided non-securities, non-investment advisory related services to Potash Corporation. Macquarie Capital Markets North America Ltd., which is a registered broker-dealer and member of FINRA, accepts responsibility for the contents of reports issued by Macquarie Capital Markets Canada Ltd in the United States and sent to US persons. Any US person wishing to effect transactions in the securities described in the reports issued by Macquarie Capital Markets Canada Ltd should do so with Macquarie Capital Markets North America Ltd. The Research Distribution Policy of Macquarie Capital Markets Canada Ltd is to allow all clients that are entitled to have equal access to our research: POT
Macquarie Capital (USA) Inc. or one of its affiliates received compensation for products and services other than investment advisory services from Schlumberger during the past 12 months. During this time, Macquarie Capital (USA) Inc. or one of its affiliates has provided Schlumberger with non-securities services.: SLB
Macquarie Capital (USA) Inc. or one of its affiliates received compensation for products and services other than investment advisory services from Tesoro during the past 12 months. During this time, Macquarie Capital (USA) Inc. or one of its affiliates has provided Tesoro with non-securities services.: TSO




CNBC.com with wires.